Microsoft Seeks Stay of European Commission Antitrust Penalty

Microsoft and the European Commission faced off in open court on Thursday for the first time in their five-year legal battle over antitrust concerns.

The parties met in the Court of First Instance in Luxembourg, where Microsoft is seeking a stay of the commission's antitrust penalties against Microsoft until the European Union's courts rule on Microsoft's appeal. The appeal process could take several years.

In March, the commission, which is the EU's enforcement arm, ordered Microsoft to pay a record fine of about $610 million, to offer a version of Windows without the Windows Media Player and to disclose to competitors the interfaces required to communicate with Windows. The March announcement was the culmination of a lengthy investigation by the commission and came despite a last-minute settlement push by Microsoft that included a personal visit by Microsoft president and CEO Steve Ballmer.

On Thursday, the first day of an expected two-day proceeding, Microsoft attacked the interoperability requirements of the commission's decision. The company's attorneys held up Linux to support an argument that an immediate implementation of the commission's order wasn't necessary to protect competition.

"Without the protocols, a new product has been able to come from nothing and get 1/6 of the market in such a few years," The Associated Press quoted Microsoft attorney Ian Forrester as saying.

"The insights revealed will be revealed forever, regardless of contractual safeguards," Ian Forrester told the court. "The bell once rung cannot be un-rung."

In a statement after the proceedings, Microsoft general counsel Brad Smith claimed Microsoft exposed weaknesses in the commission's case on interoperability. Smith said the discussion on Friday would turn to the Windows Media Player issue.

Once the hearings are over, a ruling is not expected for a month or two. The Court of First Instance is the EU's second highest court. Once the Court of First Instance has ruled, the stay issue can be appealed to the president of the EU's high court, the European Court of Justice.